Samaras sworn in as head of new Greek government

Greece election – New Democracy leader Antonis Samaras is sworn in as Greece's new prime minister during a ceremony at the presidental palace in Athens on June 20, 2012.

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Greece election – Pasok party leader Evangelos Venizelos arrives for a meeting with New Democracy leader, Antonis Samaras at the Greek Parliament in Athens on June 20, 2012. Greece's three main pro-euro parties reached a deal to form a new Greek government on Wednesday.

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Greece election – Venizelos, right, shakes hands with the leader of the Democratic Party of the Left, Fotis Kouvelis, at the Greek parliament on June 19, 2012. Venizelos said discussions would continue Wednesday into the exact makeup of the new government.

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Greece election – People read newspapers which detail the coalition talks on June 19. Greece hasn't had an elected government for 223 days.

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Greece election – Children carry free vegetables donated by farmers from the Island of Crete in cooperation with the municipality of Athens, in Athens on June 20, 2012. The new coalition will have to deal with a devastating economic crisis.

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Greece election – Greek President Karolos Papoulias, right, meets New Democracy leader Antonis Samaras before he receives a mandate to form a government on June 18 in Athens.

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Greece election – Antonis Samaras, right, meets with Greece's Syriza party leader Alexis Tsipras in an attempt to form a coalition government Monday. Tsipras immediately announced the party would go into opposition rather than support Samaras.

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Greece election – The Athens stock exchange on June 18, 2012. The election victory of the pro-bailout New Democracy party eased fears of a Greek eurozone exit and brought relief to world markets.

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Greece election – New Democracy leader Antonis Samaras smiles at supporters in Athens on Sunday, June 17. His center-right, pro-bailout party came out on top in the country's parliamentary elections.

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Greece election – A New Democracy supporter celebrates as he watches the exit polls at the party's election campaign kisok in Athens.

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Greece election – Alexis Tsipras, the head of Greece's leftist Syriza party, greets supporters after a second-place finish on Sunday. He vowed to continue fighting against restrictive European bailouts.

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Greece election – The ashes of a burned ballot box remain on the floor at a polling station in central Athens. A masked group stormed the room and lit the box full of ballots on fire just before the end of voting on Sunday.

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Greece election – A woman, surrounded by media, casts her vote at a polling station in Athens.

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Greece election – A man ponders the electoral board at a polling station in Athens before voting Sunday.

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Greece election – Alexis Tsipras, the candidate of Greece's Syriza party, casts his vote in the second round of general elections at a polling station in Athens on Sunday.

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Greece election – A night before the election, a changing of the guards takes place in front of the Greek parliament in central Athens on Saturday, June 16.

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Greece election – A firefighter works on extinguishing a brush fire in the eastern Athens area of Keratea. Two brush fires broke out in Greece on Saturday, including one near seaside resorts close to Athens, just a day ahead of crucial elections.

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Greece election – The Parthenon temple is seen on the skyline of Athens.

Story highlights

International leaders see the new government as the best alternative, an analyst says

The Greek crisis threatens European economic stability

New Democracy leader Antonis Samaras was sworn in Wednesday as Greece's new prime minister, following months of political uncertainty for the debt-stricken country.

He was inaugurated at the presidential mansion after meeting with President Karolos Papoulias, who asked him to form a new Greek government.

His swearing-in followed the news that three parties -- the center-right New Democracy, which placed first in Sunday's vote, Pasok and the Democratic Party of the Left -- had reached agreement on the terms for the coalition.

The new government is expected to be sworn in Thursday, state broadcaster ERT said.

Speaking as he left the presidential mansion, Samaras said: "We trust that with God's help we will do all we can to get our people out of the crisis. I will ask the government tomorrow morning to work hard in order to be able to give tangible hope to our people."

The struggle to lead Greece

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Greece looks to form a government

Greece has been without an elected government for 223 days, and the new government, which has pledged to push for a renegotiation of the painful austerity measures imposed under the terms of an international bailout, will face significant challenges.

The country is struggling to get out of the political and financial mire that threatens to drag down Europe's common currency and spark a new global financial crisis.

Samaras met with the heads of his two coalition partners, Pasok leader Evangelos Venizelos and Fotis Kouvelis of the Democratic Party of the Left Wednesday evening, ERT reported.

Discussions continue on the government's exact makeup, Venizelos said earlier, but it is not expected to include members of the two junior parties in senior Cabinet posts.

"Greece has a government. ... That is the message that we need to send abroad," Venizelos said as he announced the deal in a televised statement.

The most critical issue for the new government is the formation of a national task force to renegotiate the terms of Greece's unpopular international bailout, he said.

Greece will go to a two-day summit in Brussels later this month determined to push fellow European leaders on the issue, he added.

Venizelos said it is unfortunate that the anti-austerity party Syriza, which placed second in the election, had declined to join the other parties in seeking the best way forward for the country.

New Democracy, which broadly favors Greece meeting international debt obligations, led the talks on forming a coalition after narrowly taking first place in Sunday's election. The socialist Pasok party placed third.

Dr. Vassilis Monastiriotis of the Hellenic Observatory at the London School of Economics, said it is a positive step that Greece now has a government, but few details about key appointments or policies are yet known.

The Cabinet will be dominated by ministers from New Democracy, after its partners said they would support the government but did not want to be part of it, he said. However, it may include a couple of technocrats from Pasok and a representative from the Democratic Left.

Venizelos's focus on the negotiating team that will seek to amend the terms of Greece's bailout deal, rather than the Cabinet, may signal his desire to be part of that team, Monastiriotis noted.

An early test for the new government will be the Brussels summit on June 28-29, when it will seek to present a strong front to European leaders as it puts forward proposals on changing the terms of the loan agreement and new investment for growth, he said.

While few specifics are known, all three parties are keen to renegotiate a provision under which Greece's current minimum wage of 750 euros a month (about $950) would be cut by 22%, Monastiriotis said.

But, he said: "There's no decision about how (they) actually deal with the immediate problems of acute poverty in parts of society and problems of tax collection."

He predicted that the international community will show patience with the new Greek government at least until September, not least because any alternative would be far more radical and anti-European.

And while Samaras has in the past been rather narrow in his views, Monastiriotis said, the politician has shown some leadership in recent days in making concessions to form the coalition.

Kouvelis announced Wednesday morning that his party's central committee would back the coalition government but that it wanted efforts made to ease the burden of austerity on the Greek people.

"This support is connected to the political platform that will be decided. The Democratic Left is insisting that this platform will contain commitments that will ensure the removal of measures that have gravely affected the Greek society. The country must have a government, but for us the substance of this government's policy is the big challenge," Kouvelis said.

The leftist party has supported bailouts from international lenders while seeking to renegotiate the terms.

With almost all ballots counted, New Democracy had won nearly 30% of the vote, the Interior Ministry said, giving the party 129 seats in the country's 300-seat Parliament.

Syriza, which campaigned against the terms of the bailout, got 71 seats.

Pasok, which long dominated Greek politics, won 33. Four smaller parties took fewer than two dozen seats each.

Alexis Tsipras, the fiery leader of the leftist Syriza party, met with Samaras but said Monday he would not back a coalition.

"History and the people will judge them by their results," Tsipras said of the parties backing some kind of bailout deal with the creditors who are keeping Greece afloat. "Shortly we will be vindicated."

He said his party's nearly 27% showing had forced Greek leaders to realize the bailout is "nonviable," and said Syriza would press as a member of the opposition for the bailout to be scrapped in its entirety.

The vote was widely seen as a referendum on whether Greece should remain tied to the euro, the currency used by 325 million people across 17 countries in Europe. The possibility of a "no" vote roiled world markets, with some analysts warning that the collapse of the euro would cost $1 trillion.

International bailouts have kept Greece from defaulting in the face of an ongoing recession and low tax revenue, but lenders have demanded hugely unpopular government budget cuts in exchange.

Some observers had predicted that efforts to renegotiate the bailout could lead to a run on Greek banks and deeper misery.

The country must identify additional budget cuts by the end of June to be considered compliant with the terms of its bailout. After five years of recession, unemployment is running at about 22%, taxes are going up and many of those with jobs are suffering cuts to wages.

German Chancellor Angela Merkel, Europe's powerful advocate for balancing budgets to build a strong basis for economic growth, had urged Greeks not to walk away from the international loan deals.

"We will stick to the agreements. That is the basis on which Europe will prosper," she said Saturday.